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Africa Panel calls for African energy revolution

CAPE TOWN, South Africa, June 05, 2015 (GNA) - African leaders must start an energy revolution that connects the unconnected, and meets the demands of consumers, businesses and investors for affordable and reliable electricity, the Africa Progress Panel has suggested.

It said that if African governments, investors, and international financial institutions significantly scaled up investment in energy, this would unlock the continent's potential as a global low-carbon superpower.

That is the main thrust of the Panel's new report, 'Power, People, Planet: Seizing Africa's Energy and Climate Opportunities', which calls for a 10-fold increase in power generation to provide all Africans with access to electricity by 2030.

This would reduce poverty and inequality, boost growth, and provide the climate leadership that is sorely missing at the international level.

The report also calls for strengthened international cooperation to close Africa's energy sector financing gap, estimated to be $55 billion annually to 2030, which includes $35 billion for investments in plant, transmission and distribution, and $20 billion for the costs of universal access.

A global connectivity fund with a target of reaching an additional 600 million Africans by 2030 is needed to drive investment in on- and off-grid energy provision. Aid donors and financial institutions should do more to unlock private investment through risk guarantees and mitigation finance.

'We categorically reject the idea that Africa has to choose between growth and low-carbon development,' said Kofi Annan, the Chairman of the Panel.

'Africa needs to utilise all of its energy assets in the short term, while building the foundations for a competitive, low-carbon energy infrastructure.'

In sub-Saharan Africa, 621 million people lack access to electricity - and this number is rising.

Excluding South Africa, which generates half the region's electricity, sub-Saharan Africa uses less electricity than Spain.

It would take the average Tanzanian eight years to use as much electricity as an average American consumes in a single month.

Over the course of one year someone boiling a kettle twice a day in the UK uses five times more electricity than an Ethiopian consumes over the same year.

Experts have pointed out that power shortages diminish the region's growth by two to four per cent a year, holding back efforts to create jobs and reduce poverty.

Despite a decade of growth, the power generation gap between Africa and other regions is widening. Nigeria is an oil exporting superpower, but 95 million of the country's citizens rely on wood, charcoal and straw for energy.

The report reveals that households living on less than $2.50 a day collectively spend $10 billion every year on energy-related products, such as charcoal, kerosene, candles and torches.

Measured on a per unit basis, Africa's poorest households are spending around $10/kWh on lighting - 20 times more than Africa's richest households. By comparison, the national average cost for electricity in the US is $0.12/kWh and in the UK is $0.15/kWh.

The report says this is a significant market failure, noting that low-cost renewable technologies could reduce the cost of energy, benefiting millions of poor households, creating investment opportunities, and cutting carbon emissions.

The report urges African governments to use the region's natural gas to provide domestic energy as well as exports, while harnessing Africa's vast untapped renewable energy potential; cut corruption, make utility governance more transparent, strengthen regulations, and increase public spending on energy infrastructure; and redirect the $21 billion spent on subsidies for loss-making utilities and electricity consumption - which benefit mainly the rich - towards connection subsidies and renewable energy investments that deliver energy to the poor. (GNA)